The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has stated that without the bank’s policy interventions, inflation could have surged to 42.81% by December 2024.
Speaking at the 2025 Monetary Policy Forum, which gathered ministers, economic leaders, and private sector stakeholders, Cardoso reaffirmed the apex bank’s commitment to orthodox monetary policies in 2025 to sustain economic stability.
He noted that counterfactual estimates indicated that, in the absence of strategic interventions, inflation would have reached an alarming 42.81% by the end of 2024. To curb this, the CBN implemented bold measures across six Monetary Policy Committee (MPC) meetings throughout the year. These included raising the Monetary Policy Rate (MPR) by a cumulative 875 basis points to 27.50%, increasing the Cash Reserve Ratio (CRR) for Other Depository Corporations by 1,750 basis points to 50.00%, and adjusting the asymmetric corridor around the MPR.
“The data suggests that without these decisive policies, inflation could have reached 42.81% by December 2024. However, the CBN took bold steps to rein in inflation and ensure economic stability,” Cardoso stated.
In addition to monetary tightening, the CBN pursued key foreign exchange (FX) reforms to enhance market efficiency. The unification of multiple exchange rate windows contributed to a 79.4% rise in diaspora remittances through International Money Transfer Operators, which climbed to $4.18 billion in the first three quarters of 2024 from $2.33 billion in the same period in 2023.
Other significant FX interventions included clearing a $7 billion FX backlog, restoring market confidence, improving liquidity, and lifting restrictions on 41 previously banned items from accessing the official FX market. The bank also introduced new minimum capital requirements for banks, effective March 2026, to bolster resilience and enhance global competitiveness in the financial sector.
As part of its financial inclusion agenda, the CBN launched the WIFI initiative under the National Financial Inclusion Strategy, targeting the gender gap in financial access. The initiative aims to empower women with financial services, education, and digital tools.
Additionally, the CBN introduced the Nigeria Foreign Exchange Code to promote integrity, transparency, and efficiency in the FX market. Cardoso described the code as a critical commitment by the financial sector to rebuild trust and enhance investor confidence.
On inflation management, he emphasized that tackling disinflation amid persistent economic shocks would require strong coordination between fiscal and monetary authorities. He reiterated the CBN’s focus on price stability, transitioning to an inflation-targeting framework, and strategies to restore purchasing power while easing economic hardships.
Cardoso expressed optimism that Nigeria had made progress in controlling inflation but stressed the need for bold and coordinated policy measures to sustain gains. He highlighted that global capital flows to emerging markets might improve as advanced economies ease monetary policies. However, Nigeria’s ability to attract foreign investments would depend on investor confidence in domestic reforms, macroeconomic stability, and favorable real returns.
Reaffirming the shift towards orthodox monetary policies, he noted that the move was designed to restore confidence, strengthen policy credibility, and prioritize price stability. Encouragingly, FX liquidity has improved, and the naira is gradually aligning with market fundamentals, fostering a more predictable environment for production, exports, and essential imports.
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